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Interim CEOs generally tend to be either a board member or a C-level executive that take on the role just to manage day-to-day CEO duties while the board search

Interim CEOs generally tend to be either a board member or a C-level executive that take on the role just to manage day-to-day CEO duties while the board searches for a more permanent replacement. In this particular instance, Whitehurst isn't a board member, but per the press release[0] he is a "Special Advisor at Silver Lake". Silver Lake is one of Unity's largest shareholders (~10%) and Egon Durban is on the board. EDIT: Also worth noting Silver Lake, along with Sequoia, committed an additional $1Bn into Unity at the time of the IronSource acquisition in the form of convertible notes with a conversion price of $48.89 / share[1], which is at a slight premium to the price at which Unity's stock traded then (7/15/2022) and at a meaningful discount to their current share price of $29.70 -- which supports the (admittedly speculative) argument that SLP's voice on that particular board is all the more prevalent today. —————————— [0]: https://www.businesswire.com/news/home/20231009494331/en/Unity-Announces-Leadership-Transition https://www.businesswire.com/news/home/20231009494331/en/Uni... [1]: https://investors.unity.com/news/news-details/2022/Unity-Announces-Merger-Agreement-with-ironSource/default.aspx https://investors.unity.com/news/news-details/2022/Unity-Ann...

cojo 3y ago
This is helpful context as well, in addition to doomlaser's explanation of his background re: IBM and Red Hat. Thanks for sharing it. I wonder to what extent Silver Lake drove this overall decision (vs. others on the board potentially initiating it)
Spoom 3y ago
Ah, Silver Lake, of Skype acquisition and zeroing-out employee equity fame. https://www.wired.com/2011/06/skype-silver-lake-evil/ https://www.wired.com/2011/06/skype-silver-lake-evil/
- hedora 3y ago
  I didn’t realize they screwed over some of the execs by zeroing out options. The night before the same transaction, they issued a pile of diluting shares to themselves, effectively clawing back something like 50% of the rank and file employees’ stock options. I might have the date and percentage wrong, but it doesn’t really matter. Silver Lake are total bastards and probably belong in jail. Avoid.
  - hyperhopper 3y ago
    I thought stocks represented ownership of a company. If a company has 100 stocks and I own 50, I own 50% of the company. If the company issues 100 more, shouldn't 50% go to me, since a share represents a part of the company ownership and I own a known percentage of the company? How is it legal to say "you bought 50% of this, but now I've arbitrary decided that I own 99% of it because I gave myself more percent"
    - rcxdude 3y ago
      It generally requires a shareholder vote to do this, so this is mostly a concern for someone who owns a minority stake in the company. And then it depends on the rules that are actually set up for the company as to what is and isn't allowed with issuing new shares. So it's very much a "read the fine print" situation.
    - batmansmk 3y ago
      You can bring in investors, go in retirement, sell your company. So ownership of a company can change. One way of doing that is to sell shares, another way is to give new ones to the newcomers. I don’t know this precise story with Silver Lake, but emitting new shares and diluting past investors to inject cash into the company is sometimes the only solution to bring cash on the account.
    - LtdJorge 3y ago
      You can always create more stocks, but that delays the value of each, so investors might not like that.
      - prerok 3y ago
        delays -> devalues, dilutes?
    - davedx 3y ago
      Nothing on paper says "You own 50% of the company". The company starts up, it has 100 shares, you get 50. If you calculate it, you own 50%. Later on the company needs to raise cash, so it issues another 100 shares. Company now has a ton of cash in the bank. Total shares outstanding is 200. Now you own 25%.
1-6 3y ago
The most famous Interim CEO was Steve Jobs.
- readyplayernull 3y ago
  He was also employee #2 and #0 at the same time, so Quantum CEO?
  - tanseydavid 3y ago
    He also aggressively recruited and hired the guy (Sculley) that got him fired from Apple on the first pass.
    - raverbashing 3y ago
      Amateur move on his part, hiring an 'MBA head' CEO
      - antupis 3y ago
        Tim Cook is also MBA and it looks like it is working fine for Apple.
        raverbashing 3y ago
        Yes but he spent a lot of time inside Apple and grew within it The problems you have selling sugar water are not the same problems that Apple has today (or since Cook moved into the post).
        antupis 3y ago
        yeah I know but issue is not MBA it is what kinda culture you come and where you are good. Selling sugar water (you need to be like super good at marketing) and leading tech firm need different skills.
        m463 3y ago
Mengkudulangsat 3y ago
Silver Lake being one of Unity's largest shareholders explains their recent behavior perfectly. It's a private equity firm whose sole concern is squeezing blood out of a rock.
- 3seashells 3y ago
  Accidentally funny name https://de.m.wikipedia.org/wiki/Silbersee_(Bitterfeld) https://de.m.wikipedia.org/wiki/Silbersee_(Bitterfeld)
- bdw5204 3y ago
  That's basically the reputation of a significant number of private equity firms. Their standard operating procedure is to load the company up with debt, cut R&D, cut investment into the product, cut wages and raise prices to increase short-term profits while pretending you're trying to turn around the company and save it. That's basically why Sears and K-Mart don't exist anymore[0] and why so many newspapers fired their journalists and replaced most of the local news with national news from the wire services[1]. [0]: https://www.cnn.com/2018/10/16/investing/retail-sears-private-equity/index.html https://www.cnn.com/2018/10/16/investing/retail-sears-privat... [1]: https://www.stern.nyu.edu/experience-stern/faculty-research/what-happens-local-newspapers-under-private-equity-ownership https://www.stern.nyu.edu/experience-stern/faculty-research/...
  - c420 3y ago
    Sounds like Twitter.
    - flarg 3y ago
      Elon's Twitter acquisition was exactly to do that but he muffed it.
      - red-iron-pine 3y ago
        Elon's twitter acquisition was a play to sell lots of incredibly overvalued TSLA stock without tanking the price. May a lot of noise, declare you're done with Twitter's bots and BS, sell a ton of stock -- not because it's overhyped, no it's for Twitter -- and then back out of the sale. And he would've gotten away except he tried to back out 3 times and they held him to it. So now he's got this trainwreck situation, and he's doing what he thinks is the right play, lemons into lemonade.
gmerc 3y ago
It confirms the concern. The board broad on someone to look after the needs of the largest shareholder
raffraffraff 3y ago
Silver Lake (along with Qualtrics founder Ryan Smith) bought Qualtrics after a dizzying sequence of planned IPO, acquisition by SAP, and then IPO. They're busily evicerating it, having just announced their second big round of layoffs, and apparently there gonna be even more job losses next March. Everyone I know there is planning their escape. What's hilarious is that this round of layoffs has impacted their ability to deliver on a major internal project because a key player was canned, so the project is now in hold (again). I wonder how many of these $$$ people are looking at Musk and saying, 'hold on, we could do that too'. It's amazing how resilient a company can be to code rot and infrastructure stagnation. It takes a long time to kill a company, once it has a customer base and decent revenue streams. You could probably fire everybody outside strictly operational teams and simply coast along on the momentum for a few years, creaming off gigantic profits. And what the hell, jack up your prices too, right?
- kasey_junk 3y ago
  Musks takeover of Twitter is not a particularly compelling example of this model. In a year he’s cut revenue by 40% (with every month trending worse than the last), not made it cash flow positive even with massive cuts, and is burdened it with tons of debt while making it worth much less. Twitter may turn around but right now I can’t imagine corporate raiders are looking at it as a positive example. https://www.reuters.com/technology/elon-musk-says-twitters-cash-flow-still-negative-ad-revenue-drops-2023-07-15/#:~:text=He%20has%20said%20Twitter%20was,from%20%245.1%20billion%20in%202021 https://www.reuters.com/technology/elon-musk-says-twitters-c.... https://www.reuters.com/technology/us-ad-revenue-musks-x-declined-each-month-since-takeover-data-2023-10-04/ https://www.reuters.com/technology/us-ad-revenue-musks-x-dec...
  - michaelt 3y ago
    Well, Musk did several things in close succession. Sure, he scared off advertisers by welcoming nazis onto the platform. That's not something you'd want to replicate. But he also fired 80% of the workforce, and the product kept working. If you have some subscription software where users keep paying $$$$ whether you add new features or not - getting rid of 80% of those expensive developers could be pretty tempting.

cojo 3y ago

This is helpful context as well, in addition to doomlaser's explanation of his background re: IBM and Red Hat. Thanks for sharing it. I wonder to what extent Silver Lake drove this overall decision (vs. others on the board potentially initiating it)

Spoom 3y ago

Ah, Silver Lake, of Skype acquisition and zeroing-out employee equity fame. https://www.wired.com/2011/06/skype-silver-lake-evil/ https://www.wired.com/2011/06/skype-silver-lake-evil/

hedora 3y ago
I didn’t realize they screwed over some of the execs by zeroing out options. The night before the same transaction, they issued a pile of diluting shares to themselves, effectively clawing back something like 50% of the rank and file employees’ stock options. I might have the date and percentage wrong, but it doesn’t really matter. Silver Lake are total bastards and probably belong in jail. Avoid.
- hyperhopper 3y ago
  I thought stocks represented ownership of a company. If a company has 100 stocks and I own 50, I own 50% of the company. If the company issues 100 more, shouldn't 50% go to me, since a share represents a part of the company ownership and I own a known percentage of the company? How is it legal to say "you bought 50% of this, but now I've arbitrary decided that I own 99% of it because I gave myself more percent"
  - rcxdude 3y ago
    It generally requires a shareholder vote to do this, so this is mostly a concern for someone who owns a minority stake in the company. And then it depends on the rules that are actually set up for the company as to what is and isn't allowed with issuing new shares. So it's very much a "read the fine print" situation.
  - batmansmk 3y ago
    You can bring in investors, go in retirement, sell your company. So ownership of a company can change. One way of doing that is to sell shares, another way is to give new ones to the newcomers. I don’t know this precise story with Silver Lake, but emitting new shares and diluting past investors to inject cash into the company is sometimes the only solution to bring cash on the account.
  - LtdJorge 3y ago
    You can always create more stocks, but that delays the value of each, so investors might not like that.
    - prerok 3y ago
      delays -> devalues, dilutes?
  - davedx 3y ago
    Nothing on paper says "You own 50% of the company". The company starts up, it has 100 shares, you get 50. If you calculate it, you own 50%. Later on the company needs to raise cash, so it issues another 100 shares. Company now has a ton of cash in the bank. Total shares outstanding is 200. Now you own 25%.

1-6 3y ago

The most famous Interim CEO was Steve Jobs.

readyplayernull 3y ago
He was also employee #2 and #0 at the same time, so Quantum CEO?
- tanseydavid 3y ago
  He also aggressively recruited and hired the guy (Sculley) that got him fired from Apple on the first pass.
  - raverbashing 3y ago
    Amateur move on his part, hiring an 'MBA head' CEO
    - antupis 3y ago
      Tim Cook is also MBA and it looks like it is working fine for Apple.
      - raverbashing 3y ago
        Yes but he spent a lot of time inside Apple and grew within it The problems you have selling sugar water are not the same problems that Apple has today (or since Cook moved into the post).
        antupis 3y ago
        yeah I know but issue is not MBA it is what kinda culture you come and where you are good. Selling sugar water (you need to be like super good at marketing) and leading tech firm need different skills.
      - m463 3y ago

Mengkudulangsat 3y ago

Silver Lake being one of Unity's largest shareholders explains their recent behavior perfectly. It's a private equity firm whose sole concern is squeezing blood out of a rock.

3seashells 3y ago
Accidentally funny name https://de.m.wikipedia.org/wiki/Silbersee_(Bitterfeld) https://de.m.wikipedia.org/wiki/Silbersee_(Bitterfeld)
bdw5204 3y ago
That's basically the reputation of a significant number of private equity firms. Their standard operating procedure is to load the company up with debt, cut R&D, cut investment into the product, cut wages and raise prices to increase short-term profits while pretending you're trying to turn around the company and save it. That's basically why Sears and K-Mart don't exist anymore[0] and why so many newspapers fired their journalists and replaced most of the local news with national news from the wire services[1]. [0]: https://www.cnn.com/2018/10/16/investing/retail-sears-private-equity/index.html https://www.cnn.com/2018/10/16/investing/retail-sears-privat... [1]: https://www.stern.nyu.edu/experience-stern/faculty-research/what-happens-local-newspapers-under-private-equity-ownership https://www.stern.nyu.edu/experience-stern/faculty-research/...
- c420 3y ago
  Sounds like Twitter.
  - flarg 3y ago
    Elon's Twitter acquisition was exactly to do that but he muffed it.
    - red-iron-pine 3y ago
      Elon's twitter acquisition was a play to sell lots of incredibly overvalued TSLA stock without tanking the price. May a lot of noise, declare you're done with Twitter's bots and BS, sell a ton of stock -- not because it's overhyped, no it's for Twitter -- and then back out of the sale. And he would've gotten away except he tried to back out 3 times and they held him to it. So now he's got this trainwreck situation, and he's doing what he thinks is the right play, lemons into lemonade.

gmerc 3y ago

It confirms the concern. The board broad on someone to look after the needs of the largest shareholder

raffraffraff 3y ago

Silver Lake (along with Qualtrics founder Ryan Smith) bought Qualtrics after a dizzying sequence of planned IPO, acquisition by SAP, and then IPO. They're busily evicerating it, having just announced their second big round of layoffs, and apparently there gonna be even more job losses next March. Everyone I know there is planning their escape. What's hilarious is that this round of layoffs has impacted their ability to deliver on a major internal project because a key player was canned, so the project is now in hold (again). I wonder how many of these $$$ people are looking at Musk and saying, 'hold on, we could do that too'. It's amazing how resilient a company can be to code rot and infrastructure stagnation. It takes a long time to kill a company, once it has a customer base and decent revenue streams. You could probably fire everybody outside strictly operational teams and simply coast along on the momentum for a few years, creaming off gigantic profits. And what the hell, jack up your prices too, right?

kasey_junk 3y ago
Musks takeover of Twitter is not a particularly compelling example of this model. In a year he’s cut revenue by 40% (with every month trending worse than the last), not made it cash flow positive even with massive cuts, and is burdened it with tons of debt while making it worth much less. Twitter may turn around but right now I can’t imagine corporate raiders are looking at it as a positive example. https://www.reuters.com/technology/elon-musk-says-twitters-cash-flow-still-negative-ad-revenue-drops-2023-07-15/#:~:text=He%20has%20said%20Twitter%20was,from%20%245.1%20billion%20in%202021 https://www.reuters.com/technology/elon-musk-says-twitters-c.... https://www.reuters.com/technology/us-ad-revenue-musks-x-declined-each-month-since-takeover-data-2023-10-04/ https://www.reuters.com/technology/us-ad-revenue-musks-x-dec...
- michaelt 3y ago
  Well, Musk did several things in close succession. Sure, he scared off advertisers by welcoming nazis onto the platform. That's not something you'd want to replicate. But he also fired 80% of the workforce, and the product kept working. If you have some subscription software where users keep paying $$$$ whether you add new features or not - getting rid of 80% of those expensive developers could be pretty tempting.